Features » June 26, 2006

The New Funding Heresies

Their names, for the most part, are unknown. But we know a bit about what they’ve been up to. In early May about 100 well-heeled progressive donors from around the country assembled in a luxury resort on the outskirts of Austin, Texas, for a 21st century version of the smoke-filled room (i.e., the smoke-free room). The occasion was the second meeting of the Democracy Alliance, a group of millionaires–including George Soros and insurance magnate Peter Lewis–who’ve pledged to give a minimum of $200,000 a year for the next five years to progressive organizations. Also in attendance were representatives from 25 organizations seeking Alliance funding.

The three-day meeting was partly a conference on the future of the progressive movement–featuring panels on America’s Role in the World, 21st Century Economics and a surprise talk by Bill Clinton, who caused a stir with his testy response to a question about his wife’s continued support of the Iraq occupation–and partly a meeting to decide who would be the beneficiaries of the Alliance’s largesse. On the last afternoon, all of the partners met behind closed doors to make their final decisions.

Oh, to be a fly on that wall.

Since word of the Alliance first spread through progressive circles last year, it has loomed large in the imagination of many in the movement. Its tight-lipped approach to publicity has given rise to rumors, speculation and grumbling about a lack of transparency. But the Alliance’s approach to long-term funding also suggests the promise of a significant change in the way the left is funded, one that many say is long overdue.

In the wake of the 2004 presidential election, more and more progressive funders are coalescing around what might be called the Infrastructure First theory of progressive revival. Originally pioneered by former Clinton Treasury official and Democracy Alliance founder Rob Stein, and now advocated by everyone from DNC chair Howard Dean to SEIU President Andy Stern, the theory goes something like this: The single most important factor in the right’s political dominance over the last several decades is its superior infrastructure–a network of well-funded, tightly coordinated advocacy organizations, grassroots groups, think tanks and media platforms that are capable of mobilizing the base, drawing in new converts, moving the national political debate and exerting astounding influence on elected politicians. In a somewhat legendary PowerPoint presentation, Stein documents the way this conservative infrastructure was built, who funded it and how it works. The Democracy Alliance’s mission is to help build a countervailing force on the left, what is cheekily referred to as the Vast Left Wing Conspiracy.

Indeed, there’s been a shroud of mystery surrounding the group from its very beginning. “Now that we are fully operational, we recognize our responsibility for greater transparency and accessability to the center-left community, including the press,” Stein, who was at the meeting, told me recently. “But last year when the Alliance was literally in formation, we consciously chose not to ballyhoo or promote ourselves.”

Secrecy isn’t limited to the Alliance. In progressive circles, it seems the first rule of fundraising is: Don’t talk about fundraising. Call up someone at a major foundation or a development director and their first response is to go off the record. “There’s a deafening silence within the movement around the role of money in movement building,” says Daniel Faber, who teaches sociology at Boston’s Northeastern University and edited Foundations for Social Change: Critical Perspectives on Philanthropy and Popular Movements. “It’s very difficult to penetrate that veil of secrecy.”

It makes sense. Progressive activists, organizers and leaders are rarely in a position to openly criticize their funders. (That includes In These Times–here’s hoping that the foundation that pays my salary admires our bracing honesty.) And funders find themselves so besieged by requests for money (not to mention right-wing invective, as Soros can tell you), there’s a tendency to fly beneath the radar. But if the progressive movement is going to build an infrastructure to rival the right, it has to examine and undo the numerous dysfunctions that stem from the way it is currently funded. In order to do that, it must initiate a public debate, no matter how awkward such a discussion might be. It might seem churlish to criticize foundations and donors that are giving away hundreds of millions of dollars, but it’s the people writing the checks that tend to make the rules and nearly everyone now agrees those rules need to change.

In more than three dozen interviews, I tried to suss out what the major criticisms of the existing funding mechanisms were and what new models were being set up to address the problems that funders, organizers, academics and observers had identified. I found, much to my surprise, a shocking degree of consensus about what’s broken and how to fix it.

So here, then, are the five heresies held by the new funding consensus.

1) Big foundations aren’t the answer

When you ask Daniel Faber who funds the left, he bluntly says that the dirty little secret is that most of the money comes from large foundations. Faber estimates that “foundation dollars provide 70 to 90 percent of funding support for most social movements.”

The majority of this money comes from just a few large foundations In a recent study of social justice philanthropy, the Foundation Center noted that two foundations, Ford and Robert Wood Johnson, provide 25 percent of foundation grants for social justice work. “That’s a tremendous concentration of influence,” Faber says. “And the problem with the mainline foundations is that they don’t attack social problems in political terms. They look at them in terms of providing services–so they look at them in isolation.”

A program director at one major foundation that funds a wide variety of progressive groups agreed with Faber. “I can’t think of any topic we work on domestically where we feel like we want to build a movement,” she said.

This attitude comes from the reformist culture of philanthropy, which grew out of a distinctly apolitical belief in noblesse oblige and neutered “charity.” But it also results from a concerted effort by conservatives to bully and intimidate foundations away from funding groups that seek to build political power. Foundations like Ford, which funds hundreds of very progressive groups, live in fear of being hauled before Congress, nailed by the IRS or mau-maued by right-wing critics for any perceived political project. (A recent cover story in The Nation recounted the latest dust-up over Ford’s funding of a U.N. conference on racism that exploded into a controversy over anti-Semitism and -Zionism.)

Things are quite different on the right. Partly because conservatives felt shut out of major foundation funding, a network of conservative family foundations grew up in the ’60s to fund the nascent movement. And unlike their mainstream counterparts, the Olin, Scaife, Coors and Heritage foundations all proudly view themselves as funders of the conservative movement.

But for the progressive movement, the single largest source of funding comes from institutions that don’t consider themselves part of the movement itself. This means that organizations are caught between pursuing their political objectives and pleasing their apolitical funders. Kim Klein, a development consultant who has spent three decades helping progressive organizations raise money, says that an over-reliance on foundation money is the “number one dysfunction” of the movement. “It reflects a lack of political analysis about the nature of money,” she says. “If you’re really serious abut social change and social justice, then you want the people engaged in membership to feel ownership. Imagine there are two lines on your phone. One is someone from the so-and-so foundation and the other is a person who lives down the street. I’ll tell you which call most executive directors take.”

2) Fund institutions and organizations, not programs

It’s tempting to view money as money: Why should it matter who a check comes from as long as it clears? But most money comes with strings attached and foundation money tends to have the most strings. Often those strings come in the form of grants for specific programs as opposed to general operating support. By granting money for specific programs, foundations can exert a tremendous amount of control over the organizations they fund. Faber says that the Ford Foundation once had a reputation for being so overbearing that grantees used to ask each other: “Have you been driven by Ford lately?”

Again, this differs from the conservative movement. A 2004 report by the National Committee For Responsive Philanthropy (NCRP) found that between 1999 and 2001 the top 79 conservative foundations gave $94.3 million in general operating support to policy and advocacy organizations against $77.5 million in program funds. In 2005, NCRP released another report which showed that the 10 best-funded conservative advocacy organizations receive 90 percent of their foundation funding in the form of general operating support. By contrast, their counterparts on the left receive just 16 percent of their foundation funding in the form of general operating support.

“There’s a place for project funding,” Stein says, “but if we’re going to build a movement, there has got to be sustainable financial security for our organizations.” This is why Democracy Alliance has committed to primarily providing general operating support. “It is almost impossible to be an aggressive, bold, problem-solving oriented institution without financial security,” Stein says. “By way of example, the Heritage Foundation has a budget of $40 million dollars but they have cash and investments of $100 million. That’s two and half years’ worth of money to be creative.”

3) Think and fund for the long term

Stein says his chief goal is to cultivate a culture of “strategic long-term investment.” Emphasis on programs, he and others say, leads to a flavor-of-the-month effect, where funders support fashionable programs for a few years and then move on to the next new thing. Alison Fine, who has served as CEO of the E-Volve Foundation and consulted with grant-seekers, says, “It’s very hard to get people to put money into long-term infrastructure because it’s not sexy. Funders want to fund things they can count, something they can bring back to their trustees or their country club and say ‘Look at what I funded,’ and what we desperately need is someone who is going to fund the process of progressive change.”

I've grappled with the meaning of 'Left' for some time. Since most parties move rightward over time, I guess we need to be aware of that. It's hard enough to stay focussed when various groups get creative with language, so that progressive can mean regressive, etc.. This is why media, such as In These Times, is powerful, a fact that we need to appreciate.
Therefore, I won't argue with those who want to call In These Times (which I've read, on and off, for many years now) a progressive journal. And I won't argue with it's idea of what 'progressive' means. I'll just say that I might have no use for ITT's progress, even if I appreciate the informational value which that outfit presents.
I've been a follower of 'alternative' media for many years. I gave up on the The Nation long ago. It, like ITT, is bookmarked in my 'media > favorites' area, but not because I'm a beliver. Republicrats (Republicans & Democrats) aren't going to fix the problems they've created and their boosters aren't fooling me. The same goes for my country's Coniberals (Conservatives & Liberals). Our New Democratic Party has really gone down the toilet - to the point now where our rightwing Green Party wants to ditch NAFTA while the NDP is happy with it and with the imperialistic direction of Canadian foreign policy generally. Witness their jello stand on Canada's participation in the overthrow of the Aristide government in Haiti. They squeaked a little and then shut up.
I'm encouraged to comment by the comments of the other posters, which give me more hope than the article which we are responding to.
Humans can't fix this mess. The folks who are here wringing their hands over their political infrastructure problems aren't going to do a thing for the poor and vulnerable in society. Of that I'm certain. Someone commented on identity politics vs discussions about economics. It really is simple, Isn't it? I express it this way: You have horizontal - shallow, not as important as other issues - vision, which is promoted by the establishment and our capitalist political classes (minus I suppose fringe parties like the communist and socialist parties), which they promote by seeming to possess that vision themselves. But it's a big game they play. Jean Chretien's effort to save the country via marketing benefitted Liberal-connected ad companies etc and led to an inquiry here on the millions that were stolen from taxpayers. I think we needed to lose Quebec long ago, for reasons like the above. The Quebec independence issue continues to prevent Canadian progress, and that's fine with capitalists who don't want to deal with the social deficits they create regularly. Let's talk about poverty in Canada and 'do something' about it. Amazingly, The corporate-owned media here 'is' talking, regularly, about poverty in Canada. But absolutely nothing gets done about it. That's because those with power don't have to do anything they don't want to do. We have a laissez faire society, unfortunately. And we do not have properly representative politics. If you aren't wealthy and connected and an owner of capital, don't expect your concerns to be acted on, if they're heard.
Then you have vertical vision - not shallow but looking at important matters and not just matters that are important to a few - which plain speaking, mostly thoughtful but powerless players, promote by setting their own honest example of simply refusing to talk nonsense just because those with more power and privilege choose to. I don't care whether I wave the Canadian flag (I'm Canadian) or the American flag, for example, as long as my standard of living doesn't go down once capitalists get their way. The harmonization of standards is in the direction of downward. Capitalists are always seeking cost cutting. That's why they want North American integration. And they have the political classes as partners in their project to do uber capitalism, which just creates social deficits and shrinks the middle class and expands poverty, since in their view benefits (good wages, job security, workplace health & safety regs etc) to workers are a cost rather than an investment, not to mention other benefits such as government regulations (oversight of water, air etc) generally.
Our continentalist leaders, despite fine sounding patriotic language and trips to the Arctic in an effort (ostensibly) to see how Canadian sovereignty can be protected, are on board with the capitalist class's project of American/ Canadian integration. I recently asked a young fellow who I met (a fellow security officer at the recent AIDS convention in Toronto) whether he cared if Canada remained Canada rather than get swallowed up by the US. His answer is typical, and a product of propaganda and horizontal vision projected by the establishment and it's media. He said he didn't want that because he wants Canada to retain it's uniqueness. But he didn't offer me any thoughts on what he meant by that.
Our health care system? Don't get misty eyed about that. The CMA - Canadian Medical Association - recently elected as it's chief a fellow who doesn't even believe in our single payer system. But I've been trying to tell people for years that it's unrealistic to expect that a large scale socialistic program like our health care system should survive within the neoliberal capitalist system we have. You can't have both, and our powerful and privileged elites have no interest in dismantling the system that provides them with their 'freedom' just so we can preserve and strengthen our socialistic Medicare. Capitalism is, in fact, just another religion. And it also happens to be one that is very successful and subscribed to by most of the planet, including it's 'Left'. If folks don't want lose socialistic programs and solutions that they believe in, then they should start talking, not about how to fix a Left that agrees with the Right on fundamentals, but capitalism itself. You don't see the word in the media much, Do you? Out of sight, out of mind.
I told that young fellow that culture is fine and important. But the priority, in my view, should be 'Do I eat or don't I?' I didn't have the time to tell him that I hardly see any difference between Canadians and Americans anyway, or I would have.Posted by Arby on 2006-08-28 19:04:35

Hi Christopher,
Though Kim stands firmly on the left, on this point, she is absolutely right when she says "an over-reliance on foundation money is the 'number one dysfunction' of the movement."
Recently just got back from Raising Change, an inspiring conference that she and the Grassroots Fundraising Journal hosted in Berkeley for 500 progressive fundraisers from the U.S., Latin America, Canada and the Pacific Rim. The main focus was that fundraising is organizing, and that if we don't provide individuals the opportunity to invest in their own communities, then we can't claim to represent the grassroots.
For more on the conference, check out the post on my blog, Fundraising for Nonprofits, gayleroberts.com/blog. Have also linked to this article on my blog.
Thanks for your work.
Peace,
GaylePosted by gaylesf on 2006-08-20 08:29:53

This article missed some very important things that should have been included.
It could have gone into Soros and his soft-power imperialist ventures around Eurasia.
It could have mentioned PACIFICA RADIO, and its long history of listener-supported public interest broadcasting. By all means go to the pacifica.org website and learn more if you are unfamiliar.
And it steered clear of questionsquestions.net and Left Gatekeepers, a website that has been exposing the foundation connections of these alleged "alternative" media for quite some time. No links to CIA were mentioned in this article, concerning Ford Foundation and others.
So, the article was basically a neutered defense of the current abysmal alternative press, and a glossing over of the behind the scenes manipulation by foundation money and CIA connected foundations.
Not impressed.
Dig deeper, if you've got the balls.
John Doraemi publishes Crimes of the State at:
http://crimesofthestate.blogspot.com/Posted by johndoraemi on 2006-07-02 11:33:02

A QUIOTE FROM THIS ARTICLE:
"Foundations like Ford, which funds hundreds of very progressive groups,"
Yes, Ford Foundation and its ilk have funded the American Left for decades. And the American Left has become what the Ford Foundation, et al., wants. And what sorts of "progressive groups" have these huge nonprofits funded?
IDENTITY POLITICS! That is what these foundations fund! They have funded a generation of pseudoLeft "progressive" activism that has shifted the focus of the American Left from economics to race and gender oriented activism.
And now we see the results of what this PseudoLeft hath wrought!
Our progressive tax base is in a shambles!
We are the only western nation without single payer healthcare.
Our labor market is flooded mass immigration of aliens driving down our wages.
The plutocrats and megacorporations set up these large nonprofit foundations like Ford in order to divert American Leftism from economics. That way the rich can keep their money by leeping the American Left focused on race and gender politics.
Read Joan Roelofs book MASK OF PLURALISM for more on this.
And PseudoLeft outfits like IN THESE TIMES, PBS, NPR, Alternet, etc are the fruit of the years of propaganda created by PseudoLeft media organs.Posted by cryofan on 2006-06-30 17:59:58